Making It Work

IF YOU HAPPEN to own a health insurance company, the worst thing that can possibley happen to you, presumably, is having no customers, or not enough customers, to stay in business. The next worst thing, logical extrapolation tells us, is that all your customers are old and sick. Out there in the market place, among all who do not currently have health insurance, in other words, out there among your potential new customers, you may end up noticing that all your salespeople have more luck gaining new customers from among the old and sick than from among the young and healthy. Your supervisor, aware of this, frets and fumes, urges you to hit the young and healthy hard, and do what you can. Such is the nature of all insurance. A large pool of customers is assembled, whether in health insurance, auto, home, or other, and the strong carry the weak. The good drivers, the solidly built houses with good fire protection, the firm healthy human bodies; these are the customers who pay the premiums bu do not utilize the service, these are the customers who provide the profit margin. And you have to have them, the good customers, becuase you have to have the profit margin. Unless, of course,you have universal, socialized insurance, in which case, no profit is needed, only fundamental solvency. Because of this inherent structure wherein the low risks support the high risks, the strong carrying the weak, you could almost, if you look at it just the right way, see that the very nature of the insurance industry, even in its most privatized, captialistic form, is underpinned by a certain "socialistic" framework, as the strong pay their way, and other's, while the high risks receive most of the claim pay outs. As obamacare kicks in, the concern is that all across America, millions of old sick people will sign up, and millions of young healthy folks will stay away. A "death spiral", its called, within the business. Conservative free market loving republicans types perhaps feel that there'll be too many old sick high risk "free loaders" in any socialized system, but really, they exist in any system, public or private, regardless of screening. If you screen out too many people, high risk or not, privately, you'll not have enough customers to create a customer pool. So, the old and sick will always be among you, and, for the most part, it will, sooner or later, include us all. And therein lies the one compelling reason for maintaining one, single, huge pool of insurance customers, indlucing everybody, by law. It creates the widest possible distribution of risk. NO competition? NO Problem. Operate the system as efficiently as possible, and, if and when there is a profit, consider it a signal that rates are a bit too high, and if there is a sortfall, a sign that rates need be raised a bit. At one time or other, nearly all of us are young and healthy, and then, old and sick. IN any insurance scheme, private or public, we are all, whether like it or not, working together. We might as well make it work, together.